Report Contents

June 24, 2021

Europe

EUROPE: Managing the pandemic – what we are watching

BY Andrius Tursa, Antonio Barroso, Carsten Nickel, Luis Cornago

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This updated weekly piece provides snapshots of how selected European governments are dealing with the ongoing Covid-19 pandemic. Please do not hesitate to contact us if you want to discuss any of the countries mentioned in more detail.

Graph of the week

EUROPE: Managing the pandemic – what we are watching 1 EUROPE: Managing the pandemic – what we are watching 2EUROPE: Managing the pandemic – what we are watching 3

France

– Cases, hospitalizations, and deaths due to Covid-19 continue to fall, but the Delta variant already represents around 6-7% of all new infections. However, the government is unlikely to change its calendar regarding the lifting of restrictions; nightclubs are expected to reopen on 9 July with some limitations.

– The government is betting on injecting at least 75% of the population with a first dose of the vaccine by end-August to counter a new Covid-19 wave. At the current rate of more than 570,000 daily jabs, such a goal looks within reach.

– The Republicans (LR) party will likely perform well in the second round of the regional elections on 27 June. However, its good results will likely make it more difficult for the center-right to agree on a candidate that could challenge the Emmanuel Macron-Marine Le Pen duopoly in next year’s presidential contest.

Spain

– Daily cases have slightly increased over the last 14 days but remain around 5,000. The number of deaths due to Covid-19 has also seen a slight uptick, although the number of hospitalizations has continued to decrease in the last week.

– The government has missed its target of vaccinating at least 15mn adults by mid-June by 600,000 individuals, allegedly due to delays in the delivery of the Janssen jab. Still, at the current speed of daily vaccinations, the government might still meet the goal of vaccinating 70% of the population by end-August.

– Madrid’s decision to pardon the jailed secessionist leaders on 22 June has led the opposition to call for Prime Minister Pedro Sanchez’s resignation. Although the move might hurt Sanchez electorally in the future, however, it is likely to strengthen the PSOE-Podemos coalition in the short term.

Italy

– The seven-day average of new infections continues to fall, with daily cases now just above 1,000; more than 50% of the population have received one jab, and around 28% are fully vaccinated.

– Mask-wearing outdoors will no longer be required in the lowest-risk “white zones” from 28 June. Currently, the entire country, except for the small northwest Valle D’Aosta region, is classified as a “white zone.”

– Italy has received a green light for its Recovery and Resilience Plan by the EC on 22 June. The country is now set to receive an initial tranche worth EUR 24.9bn by July and a total of EUR 191.5bn by 2026 – of which EUR 68.9bn will come in the form of grants and EUR 122.6bn in loans.

Germany

– The seven-day average of new infections continues to fall, with cases now below 1,000; more than 50% of the population have received one dose, and more than 30% are fully vaccinated.

– Chancellor Angela Merkel maintains her promise of offering vaccines to all adult citizens by the end of the summer; given expected deliveries from Pfizer and Moderna, this remains a realistic goal, according to Merkel.

– Merkel also complained about an EU-wide lack of coordination on travel; the chancellor called on other member states to uphold quarantine rules for people entering the EU from the UK to keep the delta variant under control.

United Kingdom

– The UK is firmly entering a fourth wave, as the seven-day average of new infection has climbed above 10,000 cases; more than 80% of the population have received a first dose, and just under 60% are fully vaccinated.

– However, the success of the vaccination campaign appears to have significantly limited the rise in Covid-related deaths since the last stage of the reopening agenda in mid-May.

– There are some calls for bringing the delayed final stage of the reopening of England forward to 9 July, but the government will likely stick to the new date of 19 July, winning some more time to monitor the pandemic situation.

Greece

– Earlier this week, health experts recommended that Greeks no longer wear face masks outdoors as part of the further loosening of Covid-19 restrictions. The move comes amid a significant decline over the past few days in new cases, with the seven-day rolling average of daily cases below 400.

– Around 30% of Greeks have been fully vaccinated, while close to 43% have received at least one jab. However, the uptake so far has been patchy in terms of geography and age. The main concern is the reluctance of many elderly Greeks to be vaccinated. The average uptake among Greeks over 60 stands at roughly 72%.

– The draft bill of the supplementary pension reform was presented to the cabinet on 23 June. The new system is based on a pay-as-you-earn system of supplementary social security that will concern workers up to 35 years old, by choice, and newcomers into the labor market. The bill is expected to be approved by parliament in August.

Poland

– The seven-day rolling average of new infections dropped below 200 – the lowest point since the outbreak of the pandemic in March 2020. However, the authorities have identified over 90 cases of the Delta variant to date and are closely monitoring the epidemiological data.

– To prevent the spread of new virus variants, the government introduced on 23 June a mandatory ten-day quarantine for unvaccinated persons arriving from countries outside the Schengen area.

– To sustain the pace of the immunization campaign during the summer holiday season, residents will be able to get a second vaccine shot at a different vaccination site than the first one starting 1 July. On the same date, the government will launch a lottery for the vaccinated.

Hungary

– The seven-day rolling average of new cases fell below 100, while the daily deaths have dropped to single digits. Authorities intend to ease some of the remaining restrictions on the operation of spas and school summer camps, and review the requirement to wear masks indoors.

– Although around 55% of the population have received at least one dose of vaccine, the number of new vaccinations remains low – averaging around 10,000 per day. At such a pace, the country would vaccinate 70% of its population only by November.

– After raising the benchmark interest rate and the one-week deposit rate for the first time in a decade this week, the central bank (NBH) said it was starting a cycle of monthly rate hikes to stabilize inflation around the NBH target of 3%.

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